Car sales in May subdued as demand slows; Maruti, Tata Motors buck trend

New Delhi - Domestic car sales remained subdued in May with only Maruti Suzuki and Tata Motors clocking double-digit growth, while Hyundai and Honda posted marginal increase in sales as the auto sector continued to face challenges. Mahindra & Mahindra and Ford India reported decline in sales during the month. Maruti Suzuki India said its domestic sales rose 13 per cent in May to 1,02,359 units as against 90,560 units in same month last year. Sales of mini segment cars including Alto and WagonR, climbed 20.6 per cent to 35,062 units compared with 29,068 units in the year-ago period. [caption id=“attachment_2274324” align=“alignleft” width=“380”]  AFP[/caption] However, sales of the compact segment comprising Swift, Estilo, Ritz, Dzire declined 5.7 per cent to 41,926 units in May this year against 44,455 units a year ago. Rival Hyundai Motor India Ltd (HMIL) sold 37,450 units last month compared with 36,205 units in May 2014, up 3.4 per cent. HMIL Senior Vice-President (Sales and Marketing) Rakesh Srivastava said the growth during the month was achieved in a market experiencing low growth with decreasing contribution of rural and diesel vehicles sales. “Hyundai volumes grew to 37,450 units with fourth consecutive month of more than 10,000 units of highly successful and acceptable Elite & Active, showcasing customers’ changing preference towards brands delivering high aspirational value at attainable prices,” he added. Tata Motors sales of passenger vehicles in the domestic market in May stood at 11,138 units as against 9,230 units in the same month last year – up 20.67 per cent. Commenting on the performance of the passenger vehicles segment, Tata Motors President (Passenger Vehicles Business Unit) Mayank Pareek said the automotive market is still on a slow recovery path. “First time buyers are still not coming out in full to spur sales. Interest rates have not still come down and many customers are still not engaging in taking up loans and are holding back in expectation of rates coming down,” he added. He said the industry could continue to face slow growth in the first half of the fiscal and there may be some improvement in the second half depending on a variety of factors such as the growth of economy and monsoons. Honda Cars India reported a marginal increase in domestic sales at 13,431 units in May as compared to 13,362 units in same period of previous year. Utility vehicle major Mahindra & Mahindra saw its sales decline 6 per cent in the domestic market. The company sold 33,369 units last month as against 35,499 units in the same month of last year. On the outlook, M&M Chief Executive (Automotive Division) Pravin Shah said: “The auto industry has been showing signs of recovery and it is important that factors like an interest rate cut if considered, would accelerate growth.” He further said: “At Mahindra we hope to see improved sentiments with higher level of economic activities…” Ford India’s domestic sales were at 4,726 units last month, down 21.92 per cent from 6,053 units a year ago. Hinduja Group flagship company Ashok Leyland reported 40.13 per cent jump in total sales to 9,294 units in May as against 6,632 units in the same month last year. In the two-wheeler segment, Honda Motorcycle & Scooter India (HMSI) reported an 3.28 per cent increase in total sales at 3,67,226 units in May. Niche bike maker Royal Enfield’s domestic sales were at 34,615 units during the month as against 24,509 units in May last year, up 41.23 per cent. PTI